5 Key Events That Will Shape the Business Landscape in 2023

• Nigeria’s 2023 general elections, fuel subsidy and forex availability are some issues that will shape the year 2023.

 

The holidays and their attendant celebrations have come and gone, and gradually, life is getting back to normal. The year 2023 is expected to be a very eventful one, and for good reasons. 2023 is the year that is expected to see Buhari’s planned exit and the swearing in of a new government; there is so much to look forward to this year. 

The question on the lips of many, however, is how much the business landscape will be affected and what impact some major events will have. Let’s take a look at some of these and see just how much they might impact have in the scheme of things.

Highlighted below are some major events that will shape the year 2023. 

 

2023 General Elections

Nigeria’s general election, which is scheduled to hold in February and March, is certainly going to be a major decider of a number of things for the country. The Presidential and National Assembly elections will take place on February 25, 2023, while the Governorship and State Houses of Assembly elections will take place on March 11, 2023. 

Already the presidential campaigns are underway, and the three major candidates have swung into full campaign mode, touring various parts of the country. A recent poll conducted by the We2Geda Foundation, which randomly surveyed a total of 15,438 registered voters in 36 states and the FCT, showed that the Labour Party candidate, Peter Obi, is favourably favoured to win the 2023 presidential election.

According to the group, the result of the WE2Geda poll showed a clear lead for the Labour Party (LP) presidential flag-bearer, Mr. Peter Obi, with 51 percent of respondents suggesting voting for him as their preferred candidate if the presidential election were held today.

Twenty-five percent suggested voting for Alhaji Atiku Abubakar of the People’s Democratic Party (PDP), while Bola Tinubu of the All Progressives Congress (APC) ranked third with 19 percent.

It also maintained that Peter Obi remained a consistent favourite in the four major geopolitical zones, including North-Central, South-South, South-West and South-East, while Alhaji Atiku Abubakar was the poll leader in the North-East and North-West zones.

The poll no doubt commendable, however is far from being totally reflective if one is to take into perspective antecedents and past election trends. Experience shows that the likely outcome is usually very different from the result such polls throw up.

In all, Nigeria’s economic direction will largely depend on who wins the coming presidential election.

 

Fuel Subsidy 

The issue of fuel subsidies and the humongous amount this exercise takes out of the nation’s coffers continues to be that elicites heated debates. Opinions are largely divided, and this largely depends on what side of the divide an individual happens to be on. 

While the Nigerian Labour Congress and the Trade Union Congress are sternly against its removal, the government, on the other hand, wants it gone, especially in the face of dwindling revenue and a huge budget deficit.

The Buhari government had earlier attempted to implement the removal late last year but rescinded on that move when it gauged the public’s stern disapproval level.

According to Nigeria’s Minister of Finance and National Planning, Zainab Ahmed, Nigeria spends N18.6 billion daily on PMS, and it spent N6.2 trillion on subsidies between 2013 and 2021. Also, the country was expecting to spend a whopping N3.35 trillion on subsidies within the first six months of this year.  

While many see the potential of what such a sum could do and be used to achieve within the country’s budget planning, many fear that its removal, rather than improving the country’s socio-economic status, will find its way into private pockets, defeating the purpose.

As it stands, the Buhari government has suspended the plan and conspicuously left it for the next government to deal with. The manner in which whoever wins the presidential election handles the subsidy issue will undoubtedly have a significant impact on the country.

 

Inflation

Buoyed by rising fuel scarcity, energy prices, and an increase in food costs, Nigeria’s inflation rate rose for the 10th consecutive month in November 2022, to 21.47 percent from 21.09 percent. This was according to the National Bureau of Statistics.

Nigeria has continued to battle to keep its inflation rates down, with the Central Bank struggling to maintain control and ease pressure on the naira. With so much not in its favour and in the midst of various policy somersaults, the issue of inflation, the high cost of goods and services, and most especially the availability of premium motor spirits (PMS), will be something to watch out for this year and see just how well the country is able to manage its affairs.

 

Forex Availability And Subsidy

Nigeria’s has struggled with its foreign exchange earnings for so long. Nigeria is largely an import dependent country, and this means its means of earning forex is limited. It largely relies on oil revenue, non-oil exports, foreign direct investment, foreign portfolio investment and diaspora remittanced. Much of these sources are however, very limited with not enough yield to cater to its forex needs. 

This, thus puts a huge burden on the availability of forex in the country. What’s more, the increase in oil thefts further impacts the availability of foreign currency within the Nigerian market. This demand is what has made the black market setup flourish for those who are ready to pay whatever amount to get foreign currencies. This pressure has caused the naira to depreciate by as much as N800 to $1 on the black market.

Nigeria’s Eurobond yields have literally hit junk status, with the 10-year bond yield hitting as low as 14.2% as of October 28th, 2022. At this rate, it is highly unlikely that the country can shore up its forex needs from the bond market. 

The impact of the scarcity of dollars on small businesses cannot be imagined. Many resort to the black market to get this scarce currency. With all of these, just how much the Central Bank of Nigeria is able to maintain a semblance of sanity in this regard will go a long way toward showing just how well businesses will be impacted this year.

 

Nigeria’s Planned Population Census

After more than 17 years since the last population census was conducted in the country, Nigeria’s National Population Commission is planning to conduct another national head count of its citizens. 

Nigeria’s censuses have a tumultuous history, as they have been fraught with controversy and have not been credible with debates over their authenticity. The country’s population estimates has been largely based on the 1963 census even though its reliability has also been questioned over the years

As of 2020, the National Population Commission (NPC) revealed that the country’s total population stood at 206 million, but of course, this is just an estimate.

The census, tentatively scheduled for April 2023, shortly after the general election, is sure going to be one to watch out for and a decider of a number of political developments.

Conclusion

Whatever happens, 2023 will undoubtedly be a whirlwind of activities. Whichever way, everyone simply needs to fasten their seatbelts and take the plunge.